Foundation Review

Last Updated October 26, 2021
Luci Goodman
Luci Goodman

What is Foundation

Foundation is an NFT marketplace that allows creators to buy and sell NFT art in an auction setting. Auctions run for 24 hours once a minimum bid is placed.

The company was founded in 2020, and it prides itself on curating exclusive digital art. Set up more like an art gallery, Foundation has featured digital assets from well-known NFT artists such as Kevin Roose, Pak, Jack Butcher, and more.

With so much hype around the new creative economy, many marketplaces have been flooded with new mints, causing potential buyers to sort through many GIFs and memes to find the asset the way. To keep things simple, Foundation minimizes the types of products sold on their platform, allowing buyers to find potentially valuable art quickly.

How does Foundation work?

Like some of the other best NFT marketplaces such as OpenSea and Rarible, Foundation is DeFi platform that runs on the Ethereum blockchain, allowing people to buy and sell unique digital artwork. That being said, it is fairly difficult to get the opportunity to sell on Foundation, as you need an invite from one of their current artists.

When listing crypto art for sale, creators set a “reserved” price that must be met for the auction to begin. When a potential buyer places a high enough bid, a 24-hour action will begin. If a bid is placed in the last 15 minutes, the timer will be set to 15 minutes indefinitely. At the end of the auction, both parties will finalize the transaction.

Foundation makes money through commissions made on primary sales, similar to other exclusive marketplaces such as SuperRare. The art providers will pay 15% to the platform at the point of transaction. That being said, as the creator of the non-fungible tokens, the artist will receive 10% royalties on any future sales of their art in perpetuity.

What currencies can you use on Foundation?

Ether (ETH) is the only cryptocurrency that is accepted on Foundation.app. You cannot pay with bitcoin (BTC), credit card, or fiat currency (USD, GBP, AUD, etc.).

To use the platform, you will need to connect a web3 wallet, such as MetaMask, that runs on the Ethereum network.

What types of NFTs can you buy on Foundation?

As a buyer, you will be able to browse through the following NFT categories on Foundation:

  • 3D Art – 3D art is interactive. To view the NFT from any angle, hold-click and move your mouse.
  • Image – Whether it is a photograph or a digital piece of art, still images are one of the most popular forms of non-fungible tokens.
  • Video – Video assets are often accompanied by music and can be film or animation.

The platform is planning to allow creators to release Audio uploads in the future.

How do you buy an NFT on Foundation?

To buy an NFT on Foundation, you will need to connect a web3 wallet to the platform with enough ETH for the digital art and gas fees. At that point, you will need to do the following:

Step 1: Find the non-fungible token you wish to buy and place a bid (meet or exceed reserve price or current price on the auction house). If the auction has already started, you will need to raise either 10% or .1 ETH.

Step 2: If others outbid you, you will need to continue to place bids to purchase the NFT. Track your bids from the option in the upper-right corner of the page.

Step 3: After winning the bid for the NFT, finish the transaction on the Ethereum blockchain.

How to store your NFTs

Foundation will not take custody of your assets. The platform only serves as a marketplace where buyers and sellers can connect. To store your NFTs, you will need to use a web3 wallet, such as MetaMask.

After you purchase your digital art on Foundation, you will need to settle the transaction to move it to your wallet. You can do this through the “Bids” option in the upper-right-hand corner of the screen.

You will also want to invest in a hardware wallet to keep your digital assets safe. NFTs stored on a browser-based wallet could be stolen if your browser or computer is compromised.

How do you sell an NFT on Foundation?

To keep their personal NFT ecosystem decluttered, Foundation has chosen to minimize the number of artists to work with. Currently, you must be invited to the platform from a current digital artist or through Community Upvote.

Once you are invited, you will be given a link that will allow you to mint an NFT on the platform. The selling process will be as follows:

Step 1: Mint an NFT through the provided link.

Step 2: Set the asset up for auction, fill in necessary details, and choose a reserve price. Your reserve price is the bare minimum you are willing to accept for your digital art. Bear in mind that you will need to pay a commission of 15% to the platform at the point of sale.

Step 3: Click “List your NFT” to list your item for auction. At this point, you will need to pay a gas fee to the Ethereum blockchain to process the setup. You can click “View on Etherscan” to see an estimate of how long it will take.

At this point, your NFT will be transferred to Foundation’s escrow until the auction finishes (or is canceled). Foundation does not take custody of your non-fungible token. Instead, all digital art is hosted on IPFS, a peer-to-peer hypermedia protocol.

Step 4: Promote your crypto art on Twitter or other social media sites to promote sales and generate hype.

Selling options on Foundation

Unlike other NFT marketplaces, you can only sell your digital assets through auctions. As a seller, you will set your “reserve” price, which must be met to start the auction timer. Potential buyers can continue to bid for 24 hours. If a bid comes in the last 15 minutes, the timer will reset to 15 minutes indefinitely.

Foundation fees

Foundation earns money through commissions on primary sales. The buyer will pay the platform 15% off of their minted assets.

As a buyer, you aren’t responsible for any fees to the platform, but you need to be aware that Foundation gives 10% of any secondary sales to the original artist. You will also need to pay gas fees to the Ethereum network at the point of sale.

Is Foundation safe to use?

Foundation is safe to use. The platform never takes custody of your NFTs. Instead, both the asset and the funds in the current bid are places in a smart-contract escrow until the end of the auction. At that point, the buyer and seller will settle the sale.

You do need to be wary of phishing sites within the blockchain space. When following direct links to Foundation, ensure that you are on Foundation.app before buying or selling. Scammers will often copy a site to steal your information or your currency.

Pros and cons of Foundation

Pros

  • Easy UI – Foundation has a clean look and is very easy to use and navigate. You can also use their filters to narrow down your choices and easily keep track of your bids.
  • Royalties – Creators earn 10% royalties on all secondary sales in perpetuity after their initial sale.
  • Auctions are popular – Auctions naturally generate a lot of hype and FOMO, allowing creators to often earn a little more than they were expecting.
  • Fewer NFTs – As the platform is very selective in who they work with, there are fewer NFTs on the marketplace, making it easier for creators to draw attention to their work.

Cons

  • ETH – You can only buy NFTs with ether (ETH). You cannot purchase them with any other cryptocurrency (such as bitcoin) or with fiat currency.
  • Commission fees – Artists need to pay a steep commission of 15% off of the primary sale of their work. That being said, this is competitive with other marketplaces that are run more like an art gallery.

Frequently asked questions

There is no cost to create an account on Foundation. That being said, if you are invited to mint art, you will need to pay gas fees to set up each asset on the platform. These fees do not go to Foundation and are paid to the Ethereum blockchain instead.

Artist will receive 10% royalties on secondary sales in perpetuity for non-fungible tokens purchased on Foundation. This will be tracked through smart contracts, storing the metadata of each transaction on blockchain technology.

On foundation, the buyer of each piece of art will pay gas fees to process the transaction. Creators will also pay gas fees when creating new digital art.